GTT, Rayonier dive on quarterly misses; Teva rises in pharma space

By James McCandless

San Antonio, Aug. 8 – As with previous days this week, the distressed market saw volume in names with earnings releases.

GTT Communications, Inc.’s notes were seen sinking after releasing a gloomy earnings report and announcing potential sales of non-strategic assets.

Sector peer CommScope Holding Co., Inc.’s issues declined amid positive earnings and a management change.

Elsewhere in communications, Frontier Communications Corp.’s paper saw separate movements after its earnings release.

Chemicals maker Rayonier Advanced Materials Inc.’s notes dived in response to its second-quarter loss.

In the pharma space, Teva Pharmaceutical Industries Ltd.’s and Endo International plc issues improved.

Energy name Chaparral Energy, Inc. was another company to see its paper gain despite missing earnings estimates.

Whiting Petroleum Corp.’s and Chesapeake Energy Corp.’s notes followed oil futures upward.

GTT sinks

GTT’s notes were sinking throughout the Thursday session, traders said.

The 7 7/8% senior notes due 2024 declined by 11 points to close at 63¾ bid.

The notes saw about $38 million on the tape by the close.

On Thursday morning, the McLean, Va.-based cloud networking company’s structure was the latest to suffer from a dismal earnings report.

Where analysts were expecting a 5 cents per share loss, the actual losses were wider at 59 cents per share.

Revenues were underwhelming at $433.8 million.

In an effort to reduce its debt, the company concurrently announced that it had hired a financial adviser to identify buyers for non-strategic assets.

CommScope off, Frontier varies

Elsewhere in communications, CommScope’s issues declined, market sources said.

The 8¼% senior notes due 2027 shed 2¼ points to close at 90¾ bid. The 5% notes due 2027 slid 1¾ points to close at 78½ bid.

The two issues combined for $29 million of trading volume during the session.

Frontier, another name releasing quarterly results on Thursday, saw largely positive results.

While analysts predicted a 58 cents per share profit, the actual profit was 66 cents per share.

Revenues came just shy of expectations at $2.57 billion.

The company also announced that chief operating officer Bruce McClelland has been let go and the position has been eliminated.

“There’s a little trend starting with scrapping the COO position,” a trader said. “It’s mainly a cost cutting measure.”

Norwalk, Conn.-based wireline telecom name Frontier’s paper varied in direction.

The 10½% senior paper due 2022 picked up 2 points to close at 53 bid. The 11% paper due 2025 dipped ½ point to close at 50¼ bid.

Rayonier dives

Meanwhile, in chemicals, Rayonier’s notes dove, traders said.

The 5½% senior notes due 2024 tanked 9 points to close at 74¼ bid.

After the close on Wednesday, the Jacksonville, Fla.-based chemicals producer released its second-quarter numbers.

The company reported a 35 cents per share loss, almost double the expected loss of 18 cents per share.

It also reported revenues of $488 million, also under expectations.

The structure has been driven further into distressed territory since its first-quarter loss in May, beginning in the mid-90’s context at the start of the month and ending in the low 80’s.

Teva, Endo improve

Pharma name Teva’s issues saw improvements, market sources said.

The 2.8% senior notes due 2028 tacked on 1 point to close at 86 bid. The 3.15% notes due 2026 also rose 1 point to close at 76½ bid.

In its second-quarter earnings release, the Petach Tikva, Israel-based generic drug company posted a better-than-expected profit of 60 cents per share and revenues of $4.34 billion.

The company also announced that it had set aside $646 million to pay potential legal expenses and had fired its chief financial officer.

The name has been under seemingly perennial pressure amid negativity in its sector and the prospect of multimillion-dollar settlements in it future.

Dublin-based peer Endo’s paper also gained.

The 6% senior paper due 2023 added ½ point to close at 63 bid. The 6% paper due 2025 garnered ½ point to close at 59 bid.

Chaparral positive

In energy, Chaparral’s notes were moving higher, traders said.

The 8¾% senior notes due 2023 shifted up 1 point to close at 53 bid.

Late Wednesday, the Oklahoma City, Okla.-based independent oil and gas producer put out its earnings.

The company reported a 1 cent per share profit, weaker than the expected 12 cents per share.

Revenues were also less than expected at $67.91 million.

Oil better

As oil futures spiked, distressed energy names followed, market sources said.

Denver-based producer Whiting Petroleum’s issues saw a boost.

The 8¾% senior notes due 2023 picked up 1 point to close at 53 bid. The 6¼% notes due 2023 added 2½ points to close at 86 bid.

Oklahoma City, Okla.-based sector peer Chesapeake Energy’s paper also trended upward.

The 8% senior paper due 2026 gained 5¼ points to close at 74 bid. The 8% paper due 2025 improved by 4½ points to close at 78¾ bid.

West Texas Intermediate crude oil futures for September delivery rose $1.45 to settle the day at $52.54 per barrel.

North Sea Brent crude oil futures for October delivery ended at $57.38 per barrel after a $1.15 improvement.

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